* Dollar index slips on U.S. pending home sales data
* Libyan rebels regain control of some oil infrastructure
* Qatar first Arab nation to recognize Libya rebels
* Coming up: API oil inventory data, 4:30 p.m. EDT Tuesday
(Recasts, updates prices and market activity, changes byline
and changes dateline from previous LONDON)
By Robert Gibbons
NEW YORK, March 28 (Reuters) - Brent crude prices turned
higher and U.S. oil pared losses on Monday after the dollar
reversed and weakened and with Middle East unrest remaining a
concern.
The dollar index <.DXY>, measuring the greenback against a
basket of currencies turned weaker and the euro climbed to a
session peak of $1.4100 after U.S. pending home sales data for
February was better than expected. [] []
Brent crude futures for May delivery <LCOc1> rose 13 cents
to $115.72 a barrel by 11:53 a.m. EDT (1553 GMT), after
bouncing off its early $114.55 low. Brent's intraday high was
$116.00.
U.S. May crude futures <CLc1> fell 68 cents to $104.72 a
barrel, swinging between $103.60 and $105.76.
"The dollar has weakened after the pending home sales data
and crude bounced," said Chris Dillman, analyst at Tradition
Energy in Stamford, Connecticut.
A weaker dollar can lift oil prices by making
dollar-denominated oil less expensive for those using other
currencies while lowering the value of currency paid to
producers and by attracting to commodities markets investors
seeking better returns.
Oil felt pressure earlier by the stronger dollar index,
that was lifted by hawkish comments by Charles Plosser,
president of the Philadelphia Federal Reserve, who suggested on
Friday a reversal from monetary easing policy would be needed
"in the not-to-distant future." [] []
A U.S. central bank move to a tightening policy and higher
interest rates and the end of the current stimulus, or
quantitative easing measures, known as QE2, could remove
liquidity from the market and slow economic growth and demand
for oil, analysts and brokers said.
Libyan rebel successes capturing oil facilities and gaining
recognition from Qatar had helped cool oil prices earlier along
with the dollar's strength, brokers and analysts said.
LOW TRADING VOLUMES
Price volatility and the uncertainty of threats to supply
from Middle East unrest and the conflict in Libya combined with
an uncertain demand picture in quake-hit Japan and the
debt-laden euro zone have curbed trading volumes, with weekly
volume for U.S. crude the lowest for the year last week,
according to Reuters data.
Light volume trading continued on Monday. Total U.S. crude
trading volume, at just over 218,000 lots traded, was 73
percent below the 30-day average. Brent trading volume at just
over 200,500 also was tracking below average.
Brent's premium to the U.S. benchmark West Texas
Intermediate crude <CL-LCO1=R> rose 66 cents to $11.08 a barrel
also in choppy trading, swinging from $10.02 to $11.22, though
remaining well off its March 1 record above $17.
(Additional reporting by Claire Milhench in London and
Alejandro Barbajosa in Singapore; Editing by Marguerita Choy)
